608 F.

2d 397
102 L.R.R.M. (BNA) 2510, 87 Lab.Cas. P 11,562

WESTERN DISTRIBUTING CO. d/b/a Western-Davis

Company, Inc., Petitioner,
v.
NATIONAL LABOR RELATIONS BOARD, Respondent.
No. 78-1559.

United States Court of Appeals,

Tenth Circuit.
Submitted Feb. 15, 1979.
Decided Sept. 19, 1979.
Rehearing Denied Nov. 2, 1979.

Glenn A. Bergmann, Denver, Colo., for petitioner.

Kenneth Hipp, Deputy Asst. Gen. Counsel, and Jesse I. Etelson, Atty.,
Washington, D. C., for respondent.
Before McWILLIAMS, BARRETT and McKAY, Circuit Judges.
McKAY, Circuit Judge.

This is a case in which the National Labor Relations Board seeks to impose a
duty to bargain on an employer who doubts he has one. Although the issues are
not as sharply drawn as we would prefer, we discern in the record and in the
briefs sufficient reason to deny enforcement of the NLRB's order.

On April 1, 1977, Davis Brothers, Inc. and Western Distributing Company

agreed to "the equivalent of a merger" between the latter and the liquor division
of Davis Brothers. Both concerns distributed wines and liquors in Colorado,
serving essentially the same clientele. Davis Brothers maintained one
warehouse in Denver. Western had one in Denver and one in Glenwood
Springs, some 170 miles away. Unlike Davis Brothers, Western did not employ
a unionized work force.

The April 1 agreement resulted in the acquisition by Western of enumerated

Davis Brothers assets in exchange for money and other consideration. WesternDavis Company, the post-merger name under which Western conducted
business, employed all 14 of the union employees formerly employed by Davis
Brothers.1 The new company also hired Davis Brothers' executive vice
president, warehouse manager, assistant warehouse manager, and sales
manager. All of these were transferred to the Denver warehouse formerly used
by Western. All the former employees of Western were retained. Fourteen
continued to work in the Western warehouse.2 Three were employed at
Glenwood Springs.

This controversy arose when the union which had represented the Davis
Brothers employees sought to retain its representative status in the new
company. Initially, the union wrote to the Davis Brothers concern to dispute
that it had, as claimed, ceased doing business and to insist that a collective
bargaining agreement was still in effect between the two. Next, on May 6 and
June 20, the union filed unfair labor practice charges against Davis Brothers
and Western-Davis respectively, alleging a refusal to bargain. The charge
against Davis Brothers was withdrawn when the NLRB determined that the
merger had taken place. The charge against Western-Davis was withdrawn
when the NLRB learned that the union had never made a formal request to
bargain. Ultimately, on August 17, the union did formally request that WesternDavis bargain. In denying this request, the company stated that it had "a good
faith doubt that your union, in fact, represents an uncoerced majority of our
employees in an appropriate bargaining unit." Record, vol. 2, at 218. The union
then filed the instant unfair labor practice charge.

The resulting NLRB proceeding ended in a determination that Western-Davis

was a successor employer obligated to bargain with the union. To reach this
conclusion, the NLRB determined that Western-Davis was obligated to bargain
as of April 1, 1977, the date of the merger. Focusing on the composition of the
work force on April 1, the NLRB applied the bargaining unit definition utilized
in the agreement between Davis Brothers and the union and therefore excluded
from the scope of the bargaining unit the three Denver long-haul drivers
formerly employed by Western. The Western-Davis employees in Glenwood
Springs were also excluded.3 These exclusions produced a bargaining unit
comprised of 14 former Davis Brothers employees and 11 former Western
employees. Inasmuch as the former Davis Brothers employees had been
represented by a union, it was concluded that, as a successor employer,
Western-Davis was obligated to bargain with that union.

Western-Davis raises a host of reasons on appeal why we should not enforce

Western-Davis raises a host of reasons on appeal why we should not enforce

the NLRB's order to bargain. We focus on the claim that Western-Davis had
good faith doubts about whether the union represented a majority of its
employees.

The general principles of relevant law are well established. Subjective good
faith doubts about a union's majority status are insufficient to justify a refusal to
bargain. The employer must demonstrate a rational basis in fact for doubting
majority status. N. L. R. B. v. King Radio Corp.,510 F.2d 1154, 1156 (10th
Cir.), Cert. denied, 423 U.S. 839, 96 S.Ct. 68, 46 L.Ed.2d 58 (1975). Even if an
employer is a "successor" for purposes of determining a duty to bargain, a good
faith doubt about majority status will shield an employer from an unfair labor
practice charge based on a refusal to bargain. See Zim's Foodliner, Inc. v. N. L.
R. B., 495 F.2d 1131, 1140 (7th Cir.), Cert. denied, 419 U.S. 838, 95 S.Ct. 66,
42 L.Ed.2d 65 (1974).

The NLRB relies on Western-Davis' alleged successorship status to impose a

duty to bargain as of April 1. Whether the merger in this case constitutes the
kind of business acquisition to which the successorship doctrine applies is a
question of some difficulty.4 However, it is a question we need not reach. Even
if Western-Davis was a successor employer capable of inheriting Davis
Brothers' duty to bargain with the union, that duty could not have arisen until a
request to bargain was made. See, e. g., N. L. R. B. v. Columbian Enameling &
Stamping Co., 306 U.S. 292, 297-98, 59 S.Ct. 501, 83 L.Ed. 660 (1939); N. L.
R. B. v. Eagle Material Handling, Inc., 558 F.2d 160, 170 (3d Cir. 1977). We
hold that no sufficient bargaining request was made until the union issued its
formal demand on August 17.5 At that time the employer's doubts about the
union majority status were justified.

Western-Davis hired 13 new employees between April 1 and August 17.6 As of

August 17, Western-Davis' employees coming within the scope of the
designated bargaining unit included 13 or 14 ex-Davis Brothers employees, 10
or 11 ex-Western employees,7 and six employees who had been previously
employed by neither concern. At most, 14 of these 30 employees could be
deemed union supporters.8 As they did not constitute a majority, Western-Davis
had an objectively valid basis for concluding it had no obligation to bargain
with the union.

10

The NLRB seeks to avoid this conclusion by suggesting that it is appropriate to

determine the level of employee support for the union as of April 1 and then
presume subsequently hired employees supported the union in the same
proportion. Although this general presumption is appropriate enough in other

circumstances, 9 it makes no great sense to invoke it in a successorship-type

context to bind an employer to a ratio of union support which existed only at a
point in time well before he was requested to bargain.
11

Our rejection of the applicability of the NLRB's presumption in this

circumstance accommodates reasonable employer expectations. On being
requested to bargain by a union with which an employer has had no collective
bargaining relationship, an employer with a modicum of awareness of the
National Labor Relations Act is likely to ask: "Do a majority of my employees
favor representation by this union?" It is not likely that he will inquire: "Did a
majority of my employees favor representation by this union four months ago?"

12

The question of good faith doubt about a union's claimed majority status must
be answered in light of the situation at the time an employer is requested to
bargain. In this case, that time was August 17. The NLRB would have us look
at August 17 through the spectacles of retrospectivity and presumption. We do
not share the NLRB's view of the matter. We decline to eliminate by artifice the
objective basis for good faith doubt supporting Western-Davis.10

13

Enforcement denied.

14

McWILLIAMS, Circuit Judge, dissents.

The union representing these employees was the International Brotherhood of

Teamsters, Chauffeurs, Warehousemen and Helpers of America, Local 435.
The union had recently concluded a bargaining agreement with Davis Brothers,
but its certification was not of recent vintage

Three of these employees were "long-haul" drivers. These employees operated

semi-trucks on long road trips. Other Denver employees also engaged in
deliveries, but used smaller vehicles and spent fewer days on the road

The reasons for the distinctions may be briefly stated. As has been suggested in
footnote 2, the long-haul drivers spent longer periods of time away from
Denver than other drivers. They did not engage in warehouse work. The
Glenwood Springs employees were geographically separated from Denver,
were separately supervised, and somewhat differently compensated
In disputing these exclusions, Western-Davis argues that the excluded Western
long-haul drivers performed duties similar to the Davis Brothers "country

drivers," which were included in the unit. It also contends that the Glenwood
Springs operation is "a very integral part of the Western-Davis operations" and
"is subject to the complete authority of Western-Davis operations in Denver."
Reply Brief for Appellant at 7.
4

Proper invocation of the successorship doctrine seeks to preserve a labor

relations status quo when the only significant change is in employer identity.
More than that appears to have changed here. Although the former Davis
Brothers employees were hired as a group, they were transferred to a new
location to join a large, preexisting group of nonunion employees. In such
altered circumstances, it may be inappropriate to invoke the successorship
doctrine to preserve a "status quo." Such an invocation may have the effect of
transforming the labor relations situation by imposing union representation on a
group of employees which have previously expressed no interest in being
represented. Such transformations may be better left to elections

We do not regard the union's April 1 telephone inquiry regarding the merger as
containing a bargaining request. Neither did the subsequent letter to Davis
Brothers, in which the union challenged the fact that Davis Brothers had gone
out of business. While it is true that the form of the words is not critical to a
bargaining request, the union must nonetheless make it "fairly clear that the
employer is being requested to bargain." N. L. R. B. v. Albuquerque Phoenix
Express, 368 F.2d 451, 453 (10th Cir. 1966). These communications were not
sufficiently clear
The strongest argument made by the NLRB in this connection is that the unfair
labor practice charges filed on May 6 and June 20 indicated a desire to bargain.
We agree that the complaints implicitly evidenced such a desire, but we are not
convinced that complaints should be construed as requests to bargain. A
complaint should only follow the refusal of a request to bargain. Apparently the
NLRB has changed its mind on this point. As we have already noted, the June
20 complaint against Western-Davis was withdrawn precisely because there
had been no prior request to bargain.

The opinion of the administrative law judge reported:

Between April 1 and (the union's) August 17 demand letter, Western-Davis'
rank-and-file complement in Denver grew by 9 through the hire of 10 new
employees, of whom three were long-haul drivers, and the severance of one;
and the Glenwood Springs complement grew by three.
Record, vol. 3, at 261.

The numerical uncertainty results from the fact that one employee who was

working on April 1 left before August 17. The record does not reveal his prior
employer
8

This result is reached even when the Glenwood Springs employees and the
long-haul drivers are excluded from the designated bargaining unit. Since their
inclusion would only bolster the non-union majority, we need not decide
whether it was appropriate for the NLRB to exclude them from the unit in
determining whether Western-Davis was obligated to bargain with the union

See, e. g., Pioneer Inn Assocs. v. N. L. R. B., 578 F.2d 835, 840 (9th Cir.
1978). But see N. L. R. B. v. Massachusetts Mach. & Stamping, Inc., 578 F.2d
15, 19-20 (1st Cir. 1978)

10

In adopting this view of the case, we have not relied on the fact that many
Western-Davis employees signed a petition expressing aversion to unionism.
This petition was generated After the employer had refused to bargain and thus
could not have been a reason for its refusal. See W & W Steel Co. v. N. L. R.
B., 599 F.2d 934 (10th Cir. 1979)